A coal gas company has been hit with fines and court costs of $100,000 for releasing contaminated water and failing to notify authorities.

Carbon Energy, which has an Underground Coal Gasification trial plant between Dalby and Chinchilla was fined $60,000 and its executive officer, Andrew Dash $2000 for breaching their environmental conditions and not notifying the department.

The company, which pleaded guilty to both charges in the Brisbane Magistrates Court on Wednesday, was also ordered to pay $40,000 in costs.

Mr Dash pleaded guilty to one count of failing to ensure Carbon Energy complied with the Environmental Protection Act.

Environment Minister Andrew Powell says charges were laid following an investigation in 2010.

"I have previously stated that we will do everything that we can to assist industry and help them do the right thing," Mr Powell said in a statement.

"However, if serious environmental harm occurs then we will vigorously pursue those who break the law."